Is it illegal to physically attack another person in Kentucky? If so, it's unclear why there is any need or cause whatsoever for the involvement of federal authorities in Rand Paul's recent altercation with a neighbor at this Kentucky home. Indeed, even if Paul had been murdered, there...

Is it illegal to physically attack another person in Kentucky? If so, it's unclear why there is any need or cause whatsoever for the involvement of federal authorities in Rand Paul's recent altercation with a neighbor at this Kentucky home. Indeed, even if Paul had been murdered, there'd still be no reason to involve federal authorities.

Murder is illegal in every one of the fifty states. It's even illegal in Puerto Rico. But, for the last several decades, there's been a disturbing trend in American criminal justice matters. Everything is being federalized.

This was not always the case, however.

Once upon a time, attacks against federal politicians were handled by state law. As one legal blog correctly notes, this changed with the adoption of 18 U.S.C. 351 into the US code:

This law provides for a death penalty for killing a member of Congress, a presidential or vice presidential candidate, or a Supreme Court justice, as well as imprisonment up to life for attempting to kill such a person...

The background of this law is interesting. When President John F. Kennedy was assassinated in Dallas in 1963, it was not a federal crime to kill a U.S. president. Had alleged assassin Lee Harvey Oswald been tried, the trial would have taken place in a Texas state court. In 1965, Congress passed a law, 18 U.S.C. 1751, making it a federal crime to kill, kidnap, or assault the President or the Vice President.

In 1968, presidential candidate and U.S. Senator Robert F. Kennedy was assassinated in Los Angeles. That was not a federal crime at the time, and Sirhan Sirhan was convicted in California state court for the murder and sentenced to death. (That sentence was commuted to life in prison in 1972, when that state abolished the death penalty, and Sirhan remains in a California state prison.) In 1971, Congress enacted 18 U.S.C. 351, which extended the protection of the Federal criminal law to members of Congress, paralleling that extended to the President and the Vice President.

This fits well into the usual habit of transferring the business of criminal justice to federal authorities with the effect of further extending federal powers and increasing prosecutorial resources that can be brought to bear against the accused. This federalization helps to further diminish the role of the states in the administration of public policy, to extend the reach — and expense — of federal courts, and to impose the costs of a double-layered legal system on the taxpayers.

Prior to federalizing these laws, had there been ambiguity as to whether it was illegal to murder, kidnap, or commit battery against people? Where the streets running with the blood of murdered federal politicians?

Of course not. These laws do send a valuable message, however. They remind us that there are one set of laws for a special protected class of federal officials, agents, and employees. And there's a second set of laws for the people who merely pay for it all.

Governor Rick Scott of Florida has called on the FBI director, Christopher Wray, to resign after it was revealed the FBI failed ot follow up on leads related to this week's school shooter. The FBI also failed to even follow its own protocol in terms of forwarding information to the local field...

Governor Rick Scott of Florida has called on the FBI director, Christopher Wray, to resign after it was revealed the FBI failed ot follow up on leads related to this week's school shooter. The FBI also failed to even follow its own protocol in terms of forwarding information to the local field office:

Robert Lasky, FBI Special Agent in Charge of the Miami field office, said agents in the Miami field office were never notified about the tip.

"The FBI has determined that protocol was not followed. The information was not provided to the Miami field office and no further investigation was conducted at that time," Lasky said Friday at a news conference. "We will conduct an in-depth review of our internal procedures for responding to information that is provided by the public."

The FBI was also notified about a comment on a YouTube video posted by a "Nikolas Cruz" last year.

"The comment simply said, 'I'm going to be a professional school shooter,'" Lasky said Thursday. "No other information was included with that comment, which would indicate a time, location or true identity of the person who made that comment."

Lasky said the FBI was unable to identify who made the remark.

A statement released Friday by the FBI said that the most recent tip should've been investigated thoroughly and forwarded to the Miami field office because it was a potential threat to life.

"We are still investigating the facts," FBI Director Christopher Wray said. "I am committed to getting to the bottom of what happened in this particular matter, as well as reviewing our processes for responding to information that we receive from the public. It's up to all Americans to be vigilant, and when members of the public contact us with concerns, we must act properly and quickly."

No doubt the FBI will "get to the bottom" of this just as it gotten to the bottom of how it failed to notice anything was amiss in the lead-up to 9/11. Perhaps the FBI will receive another big budget increase, as tends to happen after the FBI botches a major investigation.

Reactions to presidential budget proposals generally run along predictable party lines: the party occupying the White House lauds it as a sober and responsible reflection of the nation's priorities, while the opposition party insists it will kill babies and bring...

Reactions to presidential budget proposals generally run along predictable party lines: the party occupying the White House lauds it as a sober and responsible reflection of the nation's priorities, while the opposition party insists it will kill babies and bring about the general downfall of the nation. We might expect this political grandstanding to grow more intense in the Trump era, and so it has: the administration's new 2019 budget proposal has been met with howls of disapproval from many corners.

But they are not true. Trump's budget, like all presidential budgets, is a meaningless document full of trial balloons that serve current political purposes rather than determining future spending priorities. Budgets have no bearing on future actions by Congress or the president, they don't change substantive law in any area, and they don't create deterministic deficits in the future. They are political documents, and should be understood as such.

A few points bear mentioning:

Presidents have no constitutional role in the budget process, other than signing or vetoing a budget bill crafted by Congress alone.Unfortunately, the lawless and relentless rise of presidential power during the 20th century did not spare the budget process. But the Constitution plainly and unequivocally grants sole authority over the power of the purse to Congress in Article I, section 9, clause 7. Presidents are charged with executing the spending priorities of Congress, not setting them in the Oval Office.

The more modern "tradition" whereby administrations propose an annual budget to Congress in early February is entirely extra-constitutional: the legally dubious Budget and Accounting Act of 1921 created the Office of Management and Budget under the auspices of the president, when it fact such an office should fall under congressional control (as the later-created Congressional Budget Office does). It is a mistake to further entrench the harmful idea that presidents have any say whatsoever over the federal budget.

Budgets have nothing to do with taxes and spending.Congress funds all of the federal departments, agencies, and programs through the annual appropriations process. Technically there are 12 annual appropriations bills, one for each Congressional subcommittee with jurisdiction over particular funding areas (e.g. defense, transportation, agriculture). House and Senate committees each pass their version, then in theory they hammer out an agreement known as a conference report that both bodies pass and send to the President. This process has broken down mightily in the last 15 years, because the poisoned political atmosphere makes agreement on 12 huge bills (all full of tucked-away language from swarming but friendly lobbyists) nearly impossible. So in recent years Congress has passed overarching "omnibus" bills that fund everything, or packaged "minibus" bills that combine two or more appropriations bills.

But nobody gives a moment's thought to the already-passed fiscal year budget during the summer appropriations process. The budget is like an old newspaper, a story that is utterly irrelevant to the appropriations process. The only numbers that matters are last year's appropriations spending; those numbers form the "baseline" from which the committees begin-- not those suggested in the White House budget. The priorities and initiatives outlined in the administration's budget proposal are never considered for a moment.

Tax bills similarly make their way through committees in the House and Senate, though they must originate in the House. Unlike appropriations bill, tax legislation is not particular to a single fiscal year, and remains in effect unless later revoked, amended, or subject to sunset periods. Tax proposals and revenue projections contained in the budget again are irrelevant and never considered by Congress.

So how much Congress spends each year, and how much the Treasury collects in taxes, is wholly a function of the appropriations and tax bills passed by Congress (again, save for a presidential veto).

Budgets have no binding effect on Congress or the president in future years.All of the spending and revenue projections contained in the administration's budget will be utterly forgotten in a month or two. Even if passed into law, the budget bill has no legally binding effect whatsoever on future years, future Congresses, or future presidents. Nor does it have any institutional effect. Nobody in Congress ever says. "Gee, remember that budget we passed back in 2010? We projected spending only $15 billion every year for NASA. I guess we'd better stick to it since we promised... Sorry NASA."

Nobody knows, or can know what Congress will spend down the road-- just look at "emergency supplemental" bills passed during the Bush and Obama administrations to fund the wars in Iraq and Afghanistan. They were passed without regard to presidential budgets, and completely apart from the existing appropriations/omnibus/minibus bills already voted on. What exactly is the point of a budget, if Congress simply can pass additional spending bills whenever it chooses? So when the New York Times breathlessly announces Trump's budget creates huge deficits in the future or increases poverty, it displays a profound ignorance of the two points above. The administration has no budget, and it doesn't ultimately control spending and tax bills.

We all would benefit from jettisoning the presidential budget charade. It only creates more meaningless political theater, and diverts our attention from what really matters: the total amount Congress spends and the total amount it takes from the private economy in taxes.

A star high school basketball player was incidentally mentioned in an FBI probe because he was allegedly paid $15, 000 for “committing” to play for the University of Arizona. The student has recently committed to another university but may be ineligible to play college basketball next...

A star high school basketball player was incidentally mentioned in an FBI probe because he was allegedly paid $15, 000 for “committing” to play for the University of Arizona. The student has recently committed to another university but may be ineligible to play college basketball next year.

A study in 2011 estimated that the average college basketball player at a university in the top tier (FBS) of Division 1 athletics earned approximately $120, 000 including grants-in-aid to fund tuition, room and board, etc, coaching services, media and public relation services, free tickets, and other valuable services. Another study in 2017 suggests that the average Division 1 player is worth $170,098 to their employing institutions. However players on elite teams such as the Louisville, Duke, and Kentucky would be worth $1.72 million, $1.16 million and $1.02 million, respectively, on a free market.

This raises a very serious question about college athletics—but not the one that you would expect. Why is it that Federal police operate as an investigative and enforcement arm for the National Collegiate Athletic Association, the multi-billion dollar college athletics cartel whose main purpose is to ruthlessly suppress the wages of college athletes far below the additional revenue that they generate for the colleges and universities that employ them?

On Friday February 9, 2018, the Dow Jones Industrial Average closed at 24,190.9 a decline of 1,958.49 points from the end of January 2018 or a decline of 7.5%. The S&P500 fell during this period from 2,823.81 to 2,619.55 – a decline of 7.2%.

Most commentators are trying to assure stock...

On Friday February 9, 2018, the Dow Jones Industrial Average closed at 24,190.9 a decline of 1,958.49 points from the end of January 2018 or a decline of 7.5%. The S&P500 fell during this period from 2,823.81 to 2,619.55 – a decline of 7.2%.

Most commentators are trying to assure stock market participants that this correction is normal by drawing attention to the prolonged uptrend in the Dow and the S&P500. Thus, both the Dow and the S&P500 were in an uptrend since February 2009 when the Dow closed at 7,062.93 while the S&P500 closed at 735.09.

Since February 2009, the Dow has increased by 270.2% whilst the S&P500 has climbed by 284.1% as at the end of January. Moreover, many experts are drawing people’s attention to the fact that US economic fundamentals are in great shape. For instance, economic activity in terms of real GDP displays strong performance. In Q4 the annual rate stood at 2.5% against 2.3% in Q3 and 1.8% in Q4 2016.

An important reason for the correction, it is argued, is a growing likelihood for the strengthening in price inflation as a result of strong US economic fundamentals. We find this extraordinary, since an expansion in the pool of real wealth should be a mitigating factor for price inflation.

Note that after closing at minus 0.2% in April 2015 the growth momentum of the CPI has been in an uptrend with the yearly growth rate closing at 2.1% by December last year.

To moderate the future strengthening in the growth momentum of the CPI it is expected that the US central bank, the Fed, is going to tighten its interest rate stance.

This, it is held, will lift the entire interest rate structure in particular the yields on the long-term Treasury Bonds. This is seen as major negative for the stock market.

At the end of January, the yield on the 10-year T-Note closed at 2.72% against 2.411% in December last year.

The key for stock market fluctuations is monetary liquidity, which we define as the difference between the annual rate of the money supply and the annual rate of the demand for money. (The proxy for the demand for money in our modelling is depicted by the growth rate of nominal economic activity).

There is an average time lag of 20 months between changes in monetary liquidity and its effect on the annual rate of the S&P500 and the Dow Jones Industrial Average (see chart). Based on this, it is likely that the growth momentum of stock price indexes is likely to come under further pressure in the months ahead.

Contrary to the popular way of thinking, economic fundamentals are not about the growth rate in the demand for goods and services as depicted by the growth rate of GDP but by the economy’s ability to generate real wealth. We suggest that a major negative for the wealth formation process is increases in money supply.

We are of the view that the massive monetary pumping since the onset of financial de-regulation in the early 1980’s has likely severely damaged the US economy’s ability to generate real wealth. On this the money supply to its trend ratio i.e. the AMS to its trend ratio stood at 2.143 in December last year against almost 1 at the end of 1979. In other words, the amount of money has more than doubled in relation to its trend at the end of last year. Having said that the massive pumping has damaged the pool of real wealth, we do not have information regarding the state of the pool i.e. whether the pool is growing, stagnant or shrinking. We cannot ascertain the state of the pool of real wealth because we cannot quantitatively add various goods in the economy (how does one add 1 car and a loaf of bread?).

The severity of the downturn hinges on the state of the pool of real wealth. If the pool of real wealth is stagnant or even worse, declining then the economy is likely to fall into a severe recession.Now, based on the lagged growth momentum of AMS adjusted for price inflation i.e. real AMS it is likely that the growth momentum of industrial production is likely to come visibly under pressure in the months to come (see chart).

With respect to the growth momentum of price inflation we suggest that using the lagged growth momentum of AMS the yearly growth rate of the CPI is likely to strengthen for at least until the end of this year before commencing a visible decline (see chart).

Note that the future trend in the growth momentum of excess AMS is going to be decisive for the turnaround in stock price indexes and the Treasury bond market. Our modelling raises the likelihood that the growth momentum of excess AMS will start gradually strengthening after September this year.

If this were to eventuate then it is possible that the growth momentum of the Dow and the S&P500 could remain under pressure until early 2020 (see chart).Using this forecast of excess AMS growth we can also suggest that the yields on the 10-year T-Bond is likely to remain under upward pressure until year-end before a visible decline is forecast to ensue (see chart).

Last month, I noted how Colorado's Congressional delegation was incensed at Jeff Sessions' posturing on the drug war and his efforts to override Colorado's constitutional measures against marijuana prohibition in the state.

Both Republicans and Democrats from Colorado condemned...

Last month, I noted how Colorado's Congressional delegation was incensed at Jeff Sessions' posturing on the drug war and his efforts to override Colorado's constitutional measures against marijuana prohibition in the state.

Both Republicans and Democrats from Colorado condemned Sessions, and this should surprise no one. Marijuana legalization would never have passed in the first place without significant amounts — even majority support — from a number of Republican counties.

Even rural Colorado is far from the sort of Bible Belt politics that impels Jeff Sessions to blithely call for federal meddling in the daily lives of private citizens. More inclined toward libertarian leave-me-alone politics, Colorado Republicans are (slightly) less likely to go running to the federal government to manage their personal habits than in some other parts of the country.

On the matter of marijuana, rejecting federal marijuana prohibitions has now become widespread in Colorado in both parties where a good economy and relatively low crime rates are not exactly driving voters to call for a repeal of the the legalization measures a majority of them voted for in 2012.

I have taken oaths to uphold the constitution as both a commissioned military officer and a state senator. Our state constitution clearly provides that marijuana, both recreational and medical, is legal by a popular vote of the citizens of Colorado. The US constitution also clearly states in the 10th amendment that any powers not expressly granted to the federal government are reserved to the states.

While some will wrongly argue that the supremacy clause or the commerce clause give the federal government the authority to meddle in our local issues, I side with conservative Supreme Court Justice Clarence Thomas: That if Congress can regulate this under the Commerce Clause, then it can regulate virtually anything — and the federal government is no longer one of limited and enumerated powers.

He goes on to say: “Whether Congress aims at the possession of drugs, guns, or any number of other items, it may continue to appropria[te] state police powers under the guise of regulating commerce.”

There are a couple of things to note here. Hill is from Colorado Springs which is the most right-wing part of Colorado, and is home to mega churches and military bases. It's about as Republican as you can get. Given the tone of his op-ed, however, it's clear Hill doesn't exactly fear blowback from his strident opposition to Sessions.

Secondly, Hill's defense of state autonomy using the Tenth Amendment is especially laudable and is the sort of thing we should routinely hear from state legislators.

Hill is right, of course, that there is nothing at all in the US Constitution autorizing federal control of substances like marijuana. It's simply not in there, and any claim of federal "supremacy" in this matter conveniently ignores the Bill if Rights.

For pragmatic reasons, Hill supports federal legislation making it clear that the federal government will leave states alone when they legalize marijuana. It is also clear from his argument, however, that such federal legislation isn't actually necessary. Federal prohibitions on drugs that void valid state laws are simply unconstitutional, whether there's any federal statute recognizing this fact, or not.

We all strive for satisfaction and purpose in our lives. We want to do what we love, love what we do, and do it well enough to pay bills and buy groceries. The Japanese have a word for this “sweet spot”: Ikigai, which translates to “a reason for being”. Artists have rendered the overlapping...

We all strive for satisfaction and purpose in our lives. We want to do what we love, love what we do, and do it well enough to pay bills and buy groceries. The Japanese have a word for this “sweet spot”: Ikigai, which translates to “a reason for being”. Artists have rendered the overlapping criteria like this:

The main four overlapping circles are what you love, what the world needs, what you can be paid for, and what you are good at. According to the diagram, the intersection of what you are good at and what you can be paid for is your profession. The intersection of what the world needs and what you love is your mission.

Sometimes three of the criteria overlap, like the case where your passion (what you are good and and what you love) and your mission (what you love and what the world needs) overlap. In that case, you have “delight and fullness, but no wealth.” Ikigai is when all four criteria are satisfied.

What the world needs, and what people will pay for, are the same

An economist wouldn’t really see a difference between the what the world needs (red circle) and what you can be paid for (blue circle). If somebody needs something, then they would be willing to pay for it. If somebody is willing to pay for something, then they necessarily want or need it.

Even if we consider social problems like poverty and homelessness, those with resources are willing to pay to help alleviate these problems. We economize on the use of resources to alleviate social problems through voluntary donations from others. Thus, somebody with a need who cannot pay for that need to be met is still covered by the blue-red total eclipse.

The law of association guarantees you a spot in the division of labor

Furthermore, the law of association guarantees that everyone has a comparative advantage. Using the language of the ikigai graphic above, everybody has a guaranteed spot in the what you are good at (green) and what you can be paid for (blue) overlap. And since the blue and the red circles are really the same, what this means is that everybody has the profession-vocation combination.

Everybody has a comparative advantage because even if somebody is really good at something, it means they incur a high cost by doing anything else. Said another way, if somebody is really good at something, then somebody else can produce something else at a relatively lower cost. The law of association is based on this logic. One man’s relative productivity in A is necessarily another man’s relative productivity in B.

Individuals find their comparative advantage by interacting with others in the market. It is only by surveying existing producers, goods, and the prices of those goods that one can make an informed decision on what to produce or where to apply for jobs.

Government gets in the way

The only thing that can hinder the natural process of individuals finding what they are good at, what they can be paid for, and what the world needs is government intervention. Price controls (including minimum wages), regulations, taxes, subsidies, and crowding-out effects can only prevent individuals from finding ikigai.

Government can also separate the what the world needs category from the what you can be paid for category. When the government removes resources from the market to pursue a separate set of ends, certain people get paid, but not necessarily to produce what the world needs. The use of the resources is no longer subject to the strict profit and loss test of the market.

We know that consumers value what producers do by the profit earned by the producer. Losses indicate that the resources used by the producer have higher-valued uses elsewhere. Since there are no market prices for anything the government does, there is no way to calculate profit and loss.

Government budget surpluses and deficits do not proxy for profit and loss because tax revenues are not related to the citizens’ satisfaction with the government’s projects. Thus we get a lot of what we don’t need and not enough of what we do need through the government.

What you love and what you prefer

So far, we’ve seen how economic theory guarantees everyone a job that satisfies three out of four of the ikigai criteria: what the world needs, what you can be paid for, and what you are good at.

Unfortunately, economic theory cannot guarantee the fourth criterion: that you love what you do. That part is up to you and your values.

Economics can guarantee, however, that you will do what you prefer, which might be considered a broader category that encompasses what you love to do.

Anything that you do voluntarily is necessarily your most-preferred course of action given your circumstances. This concept is called demonstrated preference. Murray Rothbard famously employed it in his article “Toward a Reconstruction of Utility and Welfare Economics”:

The concept of demonstrated preference is simply this: that actual choice reveals, or demonstrates, a man's preferences; that is, that his preferences are deducible from what he has chosen in action. Thus, if a man chooses to spend an hour at a concert rather than a movie, we deduce that the former was preferred, or ranked higher on his value scale. Similarly, if a man spends five dollars on a shirt we deduce that he preferred purchasing the shirt to any other uses he could have found for the money. This concept of preference, rooted in real choices, forms the keystone of the logical structure of economic analysis, and particularly of utility and welfare analysis.

Demonstrated preference does not just apply to one’s purchasing decisions. It also applies to selling decisions. If you sell your labor to an employer for a certain wage, you demonstrate that you prefer that arrangement over any other alternative given your current knowledge and preferences. You may not “love” your job, but you certainly prefer it to not working or working somewhere else, or else you would choose those paths.

One way to interpret the economic concept of demonstrated preference in a psychological way is to reflect at any given moment on all the choices you have made that have led you to your current situation. Every choice you’ve ever made has been the best one you could have made given your circumstances at the time of your choice. If you look back and see some choices you regret, this has only added to your set of information, allowing you to make more informed decisions going forward.

No matter what, we can find a certain level of contentment in the thought that all of our past experiences and choices have brought about either better circumstances or more complete information to help us make even better choices.

Conclusion

The demonstrated preference concept and the law of association have delightfully optimistic implications. Find your comparative advantage and participate in the division of labor and you will find purpose in your life knowing that you are helping the world, taking care of yourself and your family, and making the best use of your skills. While finding a profession/vocation that you love can be difficult, you can rest assured that you are always doing something you prefer to all other alternatives and that any regret can be chalked up as a learning experience.

According to the Federal Reserve's Underlying Inflation Gauge, the 12-month inflation growth in December was at 2.98 percent. That's the highest rate recorded in 136 months, or about 11 years. The last time the UIG measure was as high was in September 2006, when it was at 3 percent.

...

According to the Federal Reserve's Underlying Inflation Gauge, the 12-month inflation growth in December was at 2.98 percent. That's the highest rate recorded in 136 months, or about 11 years. The last time the UIG measure was as high was in September 2006, when it was at 3 percent.

Not shockingly, the UIG shows a higher rate of inflation than the CPI, and also shows a different trend. the UIG has been increasing in recent years while consumer price trends have been falling.

In December, while the UIG was 2.98 percent, the CPI came in at a mere 2.1 percent, which is a four-month low.

As we reported earlier today, central banks continue to remain reticent as far as raising interest rate targets and scaling back QE. The excuse is often that the economy is not hitting the "two-percent target." Two-percent, of course, indicates inflation levels that are "just right" according to the arbitrary goal set by central banks.

Politically speaking, it is also assumed that a two-percent inflation rate is palatable since it is though to offer a reasonable amount of price stability.

But what if inflation as experienced by real people — and as indicated by the broader UIG measure — is closer to three percent, and is more like the inflation rate encountered during the days of the super-heated housing bubble in 2006? That would seem to suggest more urgency in raising rates in order to put a lid on price inflation while lessen malinvestment.

According to the CPI, though, current price inflation is no where near where it was prior to the last financial crisis.

So according to the CPI at least, everything looks well under control. The UIG tells a different story, but that's not used as the basis for monetary policy.

Nicolai Foss and I have written a paper criticizing currently fashionable "stakeholder" approaches to the firm and the idea that managers should pursue "corporate social responsibility." BlackRock CEO Larry Fink, who manages $6 trillion in corporate assets, made a splash last month by...

Nicolai Foss and I have written a paper criticizing currently fashionable "stakeholder" approaches to the firm and the idea that managers should pursue "corporate social responsibility." BlackRock CEO Larry Fink, who manages $6 trillion in corporate assets, made a splash last month by insisting that corporate executives focus not on shareholders, but on a broader segment of society: "Companies must ask themselves: What role do we play in the community? How are we managing our impact on the environment? Are we working to create a diverse workforce? Are we adapting to technological change? Are we providing the retraining and opportunities that our employees and our business will need to adjust to an increasingly automated world? Are we using behavioral finance and other tools to prepare workers for retirement, so that they invest in a way that that will help them achieve their goals?"

Foss and I argue that this view ignores the basic function of ownership, which is to exercise responsibility for productive resources. Building on Mises's judgment-based view of entrepreneurship, we argue that corporations should be run in the interests of owners -- and that not everyone affected by a company's actions, let alone society at large, is an owner. Here is the abstract:

We argue that the stakeholder and CSR literatures can benefit from more systematic thinking about ownership. We discuss general notions of ownership in economics and law and the entrepreneurial notion of ownership we have developed in prior work. On this basis, we argue that stakeholder theory needs to deal more systematically with ownership as an economic function that can be exercised with greater or lesser ability, may be complementary to other economic functions, and works better when assigned to homogeneous groups. Some stakeholder groups are likely to lack what we call “ownership competence,” even if they have made relationship-specific investments, in part because of diverse interests. We also discuss CSR from the perspective of ownership and support Friedman’s original position, but with a twist. The point of Fried-man’s paper is not that firms “should” maximize profits, but that managerial pursuit of “socially responsible” activities in a discretionary way imposes costs on owners. We suggest this problem is exacerbated with entrepreneurial managers who can devise new ways to disguise self-interested actions as CSR initiatives.

The paper is titled "Stakeholders and Corporate Social Responsibility: An Ownership Perspective" and is forthcoming in Advances in Strategic Management. A manuscript copy can be downloaded at SSRN.

In Liberalism (p.115), Mises argued that "the state, the government, the laws must not in any way concern themselves with schooling or education, [which] must be left entirely to parents and to private associations and institutions."

The Private Academy project, founded under the umbrella...

In Liberalism (p.115), Mises argued that "the state, the government, the laws must not in any way concern themselves with schooling or education, [which] must be left entirely to parents and to private associations and institutions."

The Private Academy project, founded under the umbrella of the Romanian Mises Institute in 2015, started out to do just this: to offer an alternative to the decades of nationalized higher education from which learning needed to be reclaimed and repaired.

The purely private endeavor started small, with seminars on Austrian economics, and is now growing to encompass philosophy, literature, politics, religion, and the arts, in an effort to recover the "lost tools of learning". You can find out more about the project here, and visit the website here.

This a great undertaking, and a difficult one. But I hope to see many more like it in all the corners of the world.

POWER & MARKET BLOG

Power & Market offers a contrarian take on world events. We favor individual freedom, honest history, and international peace, in the tradition of Ludwig von Mises and Murray N. Rothbard. Connect to Power & Market via twitter and RSS.